Antitrust "pressure cooker"! Google (GOOGL.US) reportedly proposes to sell part of its advertising business, but European publishers are not satisfied

Two people familiar with the matter said on Wednesday that Alphabet's (GOOGL.US) Google took a significant step toward ending an EU antitrust investigation this year by offering to sell its advertising exchange AdX, but European publishers rejected the proposal as insufficient.

Last year, Google's lucrative advertising technology business was under scrutiny from EU regulators after a complaint from the European Publishers Council.

The European Commission then accused Google of favoring its own advertising service, the fourth antitrust case against the company.

Three lawyers involved in the antitrust case said Google had never previously offered to sell assets in antitrust cases.

At the same time, Google is on trial in the US, where antitrust regulators are trying to force Google to sell its Ad Manager products, including AdX and the publisher advertising server DFP.

The publishers rejected the proposal because they wanted Google to divest more than just AdX to address conflicts of interest stemming from the company's near monopoly in the advertising technology supply chain, the people said. The EU antitrust enforcer knew about the proposal, they said.

A Google spokesperson said: "As we've said before, the European Commission's allegations against our third-party display advertising products are based on a flawed understanding of the advertising technology industry, which is highly competitive and rapidly evolving. We remain committed to this business."

AdX is a platform where publishers can sell their unsold ad space to advertisers in real time.

Last year, Margrethe Vestager, the EU antitrust commissioner, suggested that Google should divest its seller tools DFP and AdX to end the conflicts of interest.

However, other people familiar with the matter said the commission was unlikely to force Google to divest assets at this stage, as the case is complex, and is more likely to order the company to stop what it calls anti-competitive behaviour in the coming months.

They said that if Google did not comply with a possible first decision from the EU in the coming months, it would then issue a divestment order.

Google's 2023 advertising revenue (including search services, Gmail, Google Play, Google Maps, YouTube, Ad Manager, AdMob and AdSense) totalled $237.85bn, accounting for 77 per cent of total revenue. The company is the dominant digital advertising platform.